Technical Analyst, Saxo Bank Group
Summary: Copper have turned bearish and could drop to strong support at 372.
A correction in Gold and Silver has been looming for a couple weeks by now, but Buyers have been too strong to give in lifting the precious metals to close above key supports. But this week might be the time when Sellers will take control.
Key support in Gold 1,981 and Silver 24,64
Copper has been hit by heavy selling after being rejected at the resistance at around 416. Broken below short-term rising trendline and fast approaching minor support at around 382.
RSI is below 40 threshold and if closing below sentiment is negative. Copper could drop to key strong support 372 .
For Copper to demolish this bearish picture a close above the rising trend line and above 55 Moving Average is needed.
Gold. A correction has been looming in Gold for quite some time as indicated by both the Bearish Engulfing top and reversal pattern and the RSI divergence but the sell-off/correction has not yet materialised.
The precious metal has dipped below the support at around 1,981 three times the past week only to close back above. Sellers will quite possibly have another go next couple of days.
If Gold closes below 1,981 it could fuel a sell-off down to the 0.618 retracement at around 1,897. Strong support at around 1,949. Keep an eye on that level as it could prove too strong to break.
55 daily Moving Average is rising indicating underlying bullish sentiment.
For Gold to resume and extend uptrend a close above 2,050 is needed.
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